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Consumers could start seeing a small reduction in electricity bills as early as October if the government completes the removal of value-added tax on system loss charges.
Energy Regulatory Commission Chairperson Francis Saturnino Juan said Wednesday that implementation could begin in October or November once the Bureau of Internal Revenue issues its corresponding circular.
The ERC had already approved Resolution No. 26 of 2026, which reclassified system loss as a pass-through cost, clearing the way for the BIR to remove the VAT imposed on the charge.
Juan said distribution utilities would then be ordered to revise their billing formats to reflect the change.
“After that, we will issue a directive to our distribution utilities so they can revise their bill format in line with what the BIR will release,” Juan told lawmakers during a budget hearing.
System loss refers to electricity that is generated or purchased but is not ultimately delivered to paying consumers because of technical and other allowable losses in the distribution network.
The move follows President Ferdinand Marcos Jr.’s directive for agencies to look for ways to bring down electricity costs, including a review of charges passed on to consumers.
The planned change will not remove the system loss charge itself. It will only eliminate the VAT currently added to that component of the bill.
If implemented on schedule, the adjustment would become one of the latest government measures aimed at trimming household electricity costs amid continuing concerns over high power rates.
